ATOL stands for Air Travel Organisers’ Licensing. The licence itself is an Air Travel Organiser’s Licence, granted by the Civil Aviation Authority (CAA). In the UK, only the airline operating a flight, an ATOL holder or a business that is exempt can make flights available to the public, and the rules also apply to businesses based outside the UK that sell to UK customers.

How the protection works

If an ATOL holder fails, customers who have not yet travelled either still get their trip or can claim a refund of the ATOL-protected amount they paid. Customers who are already away can finish their trip and get home. The cost is met mainly from the Air Travel Trust, which is funded by the ATOL Protection Contribution of £2.50 that ATOL holders pay for each passenger.

Who needs one

A travel agent does not need its own ATOL to sell another company’s ATOL-protected holidays, because it can sell as an agent for an ATOL holder. A business that puts flight-inclusive packages together itself normally needs ATOL cover in its own right, through its own licence or membership of an Accredited Body. The CAA’s licence types are Standard, Small Business, Trade and Franchise.

Common confusion

• ATOL is not travel insurance. It does not cover airline delays or cancellations, complaints about the holiday or the failure of an airline booked direct.

• A flight-only ticket issued immediately on payment, either by the airline itself or by an agent selling as the airline’s agent, is generally not ATOL protected. An agent selling flights this way must tell the customer the flight is not ATOL protected, usually on its invoices and receipts.

• What matters is whose ATOL is named on the ATOL Certificate.

Our ATOL guide covers the routes, costs and certificates in full.